Cetera advisers in the dark after report that CEO Larry Roth will be replaced by chairman Robert Moore

One adviser says it may be just one more step in the parent company's reorganization after bankruptcy

Aug 29, 2016 @ 1:03 pm

By Bruce Kelly

The 9,000 advisers across the Cetera Financial Group broker-dealer network woke up in the dark this morning regarding the future leadership of the company after a report last week said current CEO Larry Roth would be replaced by Cetera's non-executive chairman, Robert Moore.

Citing two unnamed sources, industry website RIABiz.com on Friday reported that Mr. Roth was out at Cetera Financial and Mr. Moore, a former president of LPL Financial, was in.

Cetera Financial did not confirm the report but also did not give an outright denial to its substance.

"As a matter of policy, we do not publicly discuss speculation or rumors related to our organization," said company spokesman Joseph Kuo.

Mr. Roth and Mr. Moore are both industry veterans and have both supporters and detractors in the industry.

The former CEO of AIG Advisor Group, Mr. Roth in 2013 joined the former parent of Cetera Financial, RCS Capital Corp., which at the time was controlled by former nontraded REIT czar Nicholas Schorsch. Mr. Roth was initially tapped to lead RCAP's wholesaling broker-dealer, Realty Capital Securities, before taking over as CEO of Cetera Financial in May 2014 after the abrupt departure of its longtime CEO, Valerie Brown.

Mr. Roth shepherded Cetera Financial through the bankruptcy this year of RCAP. In May, Cetera appointed Robert Moore as its non-executive chairman.

Mr. Moore resigned as president of LPL Financial in March 2015 and is now CEO of Legal & General Investment Management America, an institutional money manager.

Mr. Schorsch no longer has a role at Aretec, the successor to RCAP after it emerged from bankruptcy. The holding company is owned by financial institutions that owned RCAP notes.

“The rank and file adviser doesn't know what's going on with the management of the company,” said one Cetera Financial adviser, who asked not to be named. A knock on Mr. Roth is that he was hired by Mr. Schorsch, and could be perceived as a holdover from the old leadership that led the company into bankruptcy, the adviser said. Replacing him as CEO would be just another step for a company to take after emerging from bankruptcy, he added.

Others in the industry, however, give Mr. Roth high marks for leading Cetera Financial through the RCAP bankruptcy, and particularly for keeping advisers in their seats despite the many calls from recruiters at competing firms.

“With the mess that he was given, he did a good job,” said Larry Papike, president of Cross-Search, a recruiting firm that focuses on the independent broker-dealer industry. “Larry kept it together.”


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